ArcelorMittal enters Dow Jones Sustainability Index

Environmental improvement only represents one element in the DJ Sustainability index, but along with safety it would seem to be an important one. ArcelorMittal, as the world’s largest steel company, understandably also wants to be seen as an industry leader: to do this successfully, it needs to set the pace for CO2 reductions in the industry. An 8% reduction in CO2 emissions by 2020 (set in 2009) is part of this strategy: but it is unclear how this measures up against others in the industry.

SBB 10 Sep 2010 ArcelorMittal has become the fifth steel company to be included in the Dow Jones World Sustainability Index, which tracks the share prices of the most sustainable companies.

The index includes the top 10% of the world’s 2,500 biggest companies, selected according to a rigid system which measures long-term economic, environmental and social performance, says François Vetri of Sustainable Asset Management (SAM), the company which designed the methodology.

ArcelorMittal’s commitment to cut CO2 emissions by 8% per tonne of steel produced, a 24% reduction in the group’s lost time injury frequency rate, improved trade union relations, $31.3m of investment in communities via the ArcelorMittal Foundation and $253m of investment in research and development seem to have bolstered ArcelorMittal’s scores, Steve John, the company’s manager for socially responsible investing, said in interview with Steel Business Briefing.

Indices such as the Dow Jones Sustainability Index and FTSE4Good play a role in the company’s internal benchmarking system, providing clues as to where improvements can be made and milestones in the developments in corporate responsibility, John added.

The Dow Jones index also includes Finnish steelmakers Rautaruukki and Outokumpu, India’s Tata Steel and South Korea’s Posco.

Dow Jones also publishes a sustainability index for the Asia-Pacific region, which represents the best performing 20% in terms of sustainability out of the 600 largest companies in the region. This index includes Korea’s Hyundai Steel, Australia’s BlueScope and Japan’s Nippon Steel.

Meanwhile in North America, no steel companies featured in the top “most sustainable” 20% of the region’s 600 largest companies, SBB notes.


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